Sequestration: Last Minute Stopgap Budget
Justin Burkhardt | FXFocus.com [3]
The United Stated economy is hanging on tight in preparation for the looming apocalypse that is the fiscal cliff. Just feet from the edge and a decision was made to… You guessed it, push back the deadlines. You know that progress is weak when the U.S. Government keeps coming to the conclusion that the best decision is to remain in a state of indecision.
Today the U.S. House decided to keep the government operational for the duration of the current fiscal year, which will end on September 30th. This means that the spending cuts that went into effect on March 1st will be extended.
The implications of $85 billion in sequestration cuts are not easy to fathom, but the piper is coming to collect and a toll will have to be paid sooner or later for this fiscal irresponsibility. There is no way that endless QE coupled with unregulated government spending can go without recourse.
Many in the Democratic Party are decrying that the sequestration cuts should be replaced altogether… but even if we can avert this crisis there is no way that the U.S. economy can sustain itself at these overly inflated levels. The market is clearly due for a correction that is bigger than we all realize and all our government is doing is prolonging the inevitable.
Prepare for this apocalypse with Forward Thinking [4], an actionable trading strategy!
Market Spotlight
Investors will be focused on Friday’s economic gauge, the U.S. Jobs Report. January’s employment data was surprisingly positive, so investors will likely be treading lightly ahead of this data in preparation for the unexpected.
Live Trade Room Recap
Today in our live trade room, there were a couple of great trades but one trade in particular stood out above the rest. One of my members called for a short on the GBP.USD after a clear head and shoulders pattern emerged. Now just 10 hours later, that singular trade was up 69 pips for a 39.5% gain! Try finding that kind of return at your local bank.
[4]
Your currency analyst,
Justin Burkhardt
Disclaimer: I have no positions in any of assets mentioned, but may initiate a (long or short) position in the GBPUSD over the next 72 hours
